The Court of Appeal ruled today in favour of ExxonMobil Guyana Limited (Exxon) and the Environmental Protection Agency (EPA).
The ruling effectively reverses the judgment of Justice Sandil Kissoon given in the High Court in 2023 in which he had found that ExxonMobil Guyana was in breach of its obligations under the financial assurance provisions of its environmental permit, and that the EPA was in breach of its statutory obligations by failing to enforce the provisions of the permit.
Justice Kissoon had agreed with the applicants, Frederick Collins and Godfrey Whyte that ExxonMobil’s liability for environmental damage was unlimited and uncapped and accordingly, the guarantee which was required to be lodged by the company under the conditions of the permit to provide security for environmental liability had to be an unlimited guarantee.
Justice Kissoon had found that ExxonMobil was knowingly in breach of its obligations to lodge unlimited financial assurance by seeking to lodge a guarantee of US$2 billion. and that the EPA was in breach of its obligations to enforce the provisions of the permit by allowing ExxonMobil to do so.
He had directed the EPA to issue an enforcement notice against ExxonMobil if it failed to lodge an unlimited guarantee within 30 days of his ruling, and ordered that if it did not do so, its permit would be suspended.
ExxonMobil and the EPA then appealed to the Court of Appeal, which had stayed Justice Kissoon’s orders. The Court of Appeal heard arguments from all of the parties in February 2026.
Today, it unanimously ruled that although ExxonMobil was liable for all or any environmental damage it caused from its petroleum operations offshore Guyana, unlimited liability and financial assurance were two different concepts.
The Appeal Court found that Justice Kissoon had erred in conflating the two concepts, and that a correct interpretation of the permit’s financial assurance provisions was that ExxonMobil was required to lodge a guarantee in a definite amount.
The Court also ruled that the EPA had a discretion under the Environmental Protection Act and the permit to accept a guarantee for a defined sum and that the Judge had erred when he substituted his own discretion for that of the EPA.
The Court also held that the EPA and ExxonMobil had not acted improperly by negotiating the guarantee for US$2 billion, and that the Judge erred in substituting his discretion for the EPA as it was the sole body authorised by Parliament to make such decisions.
The Court further ruled that the Judge could not have come to the conclusion that the insurance policy lodged by ExxonMobil and accepted by the EPA was not the type of insurance in use in the international petroleum industry, as there was no evidence before him to justify such a conclusion.
As such, the Court set aside the orders issued by Justice Kissoon in 2023.
ExxonMobil was represented by Andrew Pollard, SC, Edward Luckhoo, SC, and Eleanor Luckhoo while the EPA was represented by Sanjeev Datadin and Mohanie Anganoo.
Collins and Whyte were represented by Seenath Jairam, SC, Saevion David-Longe, Melinda Janki and Abiola Wong-Inniss.
The Attorney General was represented by Arud Gossai and Shoshanna Lall.
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